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If you find yourself dealing with large medical bills, medical loans could help you pay them off over time. Medical loans are personal loans for medical expenses can be used to pay for anything from an emergency procedure to a planned elective surgery — or to refinance existing healthcare debt.
If you’re considering a medical loan to cover expenses, you’re not alone. Around half of adults wouldn’t be able to cover an unexpected $500 medical expense, according to the Kaiser Family Foundation’s Health Care Debt Survey. The June 2022 survey also found that roughly 41% of adults have at least some medical debt, and nearly a quarter of those surveyed said they had overdue medical or dental bills. That’s where medical loans come in.
Here’s what you need to know about medical loans:
- Personal loans for medical expenses
- How does a medical loan work?
- How to qualify for a medical loan
- How to compare medical loan lenders
- How to apply for a medical loan
- Pros and cons of medical loans
- Is a medical loan right for me?
- Alternatives to medical loans
Personal loans for medical expenses
Medical loans are offered by several personal loan providers. Here are Credible’s partner lenders that offer personal loans for medical expenses:
To qualify for a medical loan from these or other lenders, you’ll typically need good to excellent credit, as well as verifiable income. Because of these eligibility factors — plus the interest costs you’ll pay on the loan over time — it’s usually a good idea to consider less expensive financial avenues first.
If you decide to use a personal loan, be sure to consider as many lenders as possible to find the right loan for you. Credible makes this easy — you can compare your rates from our partner lenders in the table below in two minutes.
|Lender||Best For||Fixed rates||Min. credit score||Loan Amounts|
|low origination fees for bad credit||9.95% - 35.99% APR||550||$2,000 to $35,000|
|close rates if pre-approved||8.99% - 35.99% APR||600||$2,000 to $50,000|
|borrowers with fair credit||7.99% - 35.99% APR||660||$2,000 to $36,500|
|home improvement loans||7.49% - 25.49% APR with autopay||700||$5,000 to $100,000|
|personal loans for excellent credit||8.99% - 25.81% APR10||Does not disclose||$5,000 to $100,000|
|fast personal loans for bad credit||6.4% - 35.99% APR4||620||$1,000 to $50,000|
If you have poor or fair credit, Avant could be a good choice for either a secured or unsecured personal loan. With Avant, you can borrow $2,000 to $35,000* with repayment terms from two to five years**.
Learn More: Where to Get a $20,000 Personal Loan Fast
In addition to your credit score, Best Egg considers more than 1,500 proprietary credit attributes from sources that include external data providers and your digital footprint — which means you might be able to qualify even with a shorter credit history.
With Best Egg, you could get a personal loan for from $2,000 to $50,000 with terms from two to five years to cover medical expenses.
Check Out: 12 Best Personal Loans for Fair Credit
LendingPoint specializes in working with borrowers who have near-prime credit — usually meaning a credit score in the upper 500s or 600s. You can borrow $2,000 to $36,500 with terms from two to six years.
If you have good credit and are looking to borrow $5,000 to $100,000, LightStream could be an option. With LightStream, you could get a loan specifically for medical financing — with no fees or prepayment penalties.
Check Out: How to Get a $100,000 Personal Loan Fast
SoFi could be another option for large medical bills — you can borrow $5,000 to $100,000 with terms from two to seven years, which can also be used to cover follow-up visits and medication.
With SoFi, borrowers also have access to several perks, including unemployment protection, career coaching, and financial planning sessions.
Upstart offers medical loans from $1,000 to $50,0005. Keep in mind that Upstart also uses machine learning to “price credit” — meaning that even if you have a lower credit score, you might be able to get a lower rate if your education and job history demonstrate additional potential.
Learn More: How to Get a $50,000 Personal Loan Fast
How does a medical loan work?
You may be worried about how you’ll pay for unexpected medical bills. Some procedures, like surgery, can be costly and may not be covered by insurance. You may also need to pay for elective procedures. In these cases, a medical loan can be a good solution. With a medical loan, you can pay for various medical expenses, including surgery, dental work, and fertility treatments.
Medical loans are unsecured, which means you don’t need to put up your house, car, or other asset as collateral. If you can’t repay the loans, you won’t risk losing your personal property. However, since medical loans are unsecured, you’ll need a healthy credit score to get the best rates.
Applying for a medical loan is typically quick and easy — you can compare multiple lenders online to find the best interest rate and repayment terms for you, and many lenders allow you to apply online. Though you might prequalify within minutes, funding the loan can take up to five business days with many online lenders.
How to qualify for a medical loan
Each lender has its own set of requirements when it comes to qualifying for a personal loan to cover medical debt. However, there are a few common eligibility criteria you’ll likely have to meet, including:
- Good credit: You’ll typically need good to excellent credit to qualify for a personal loan for medical expenses — a good credit score is usually considered to be 700 or higher. There are also some lenders that offer medical loans for poor credit. However, these bad credit loans usually come with higher interest rates compared to good credit loans.
- Verifiable income: Some lenders have a minimum income requirement while others don’t — but in either case, you’ll likely need to provide proof of income to show you can afford to repay the loan.
- Low debt-to-income ratio: Your debt-to-income (DTI) ratio is the amount you owe on monthly debt payments compared to your income. To be eligible for a personal loan, your DTI ratio should be no higher than 40% — though some lenders might require lower ratios.
Tip: If you have poor credit and are struggling to get approved for a personal loan, consider applying with a creditworthy cosigner. Not all lenders allow cosigners on personal loans, but some do. A cosigner is someone who agrees to be held legally responsible for repayment, even if you’re the primary borrower.
How to compare medical loan lenders
As you weigh your medical loan options, it’s important to shop around and compare as many lenders as you can to find the right loan for your situation.
Here are a few important factors to keep in mind as you do your research:
- Interest rates: The interest rate on your loan will play a major role in determining how much your loan will cost. In general, the better your rate, the lower your overall loan amount will be. Your credit and the repayment term you choose will also impact the rates you’re offered.
- Repayment terms: You’ll typically have one to seven years to repay a personal loan for medical expenses, depending on the lender. It’s usually best to choose the shortest term you can afford to keep your interest costs as low as possible. Additionally, several lenders offer better rates to borrowers who opt for shorter terms.
- Loan amounts: Personal loans typically range from $600 up to $100,000 (or more), depending on the lender.
- Fees: Lenders sometimes charge fees on personal loans, such as origination fees. These can increase your overall loan cost. Keep in mind that if you take out a personal loan through Credible, you won’t have to worry about prepayment penalties.
Before you borrow, also be sure to think about how much a personal loan will cost you — this way, you can be prepared for any added expenses. You can estimate how much you’ll pay for a loan using our personal loan calculator.
Enter your loan information to calculate how much you could pay
With a $ loan, you will pay $ monthly and a total of $ in interest over the life of your loan. You will pay a total of $ over the life of the loan.
Learn More: Debt Consolidation Loans
How to apply for a medical loan
If you’re ready to apply for a medical loan, follow these four steps:
- Research and compare lenders. Be sure to consider as many lenders as you can to find the right loan for your situation. Consider not only interest rates but also repayment terms, any fees charged by the lender, and eligibility requirements.
- Pick your loan option. After comparing lenders, choose the loan option that best suits your needs.
- Complete the application. Once you’ve picked a lender, you’ll need to fill out a full application and submit any required documentation, such as tax returns or pay stubs.
- Get your loan funds. If you’re approved, the lender will have you sign for the loan so the funds can be released to you. The time to fund a personal loan is usually about one week — though some lenders will fund loans as soon as the same or next business day after approval.
If you’re ready to find your loan, Credible can help: You can see your prequalified rates from multiple vetted lenders in just two minutes — without affecting your credit.
Pros and cons of medical loans
Medical loans are a convenient option when you need funds quickly to cover an unexpected medical cost. But, like all financial products, there are pros and cons to consider.
- Variety of loan terms: Medical loans offer multiple loan terms, so you can choose what works best for your budget. Longer repayment terms mean lower monthly payments, but you’ll pay more interest over time. On the other hand, shorter repayment terms equal a higher monthly payment with a lower cost over time.
- Fast funding: Many personal loans for medical expenses have fast funding options. You’ll likely be able to receive funds in your account within a few days (sometimes as soon as the next day).
- Flexible use: You can use medical loans for virtually anything, including elective or essential procedures not covered by your health insurance.
- Can be less expensive than a credit card: You’ll likely pay a lower interest rate for a personal loan than you would on a credit card (unless it’s a card with a 0% APR for a short introductory period, and you can afford a fast payoff). The average credit card interest rate is 18.43%, according to the latest data from the Federal Reserve. In contrast, personal loans average 10.16%.
- High interest rates for poor credit: If you have bad credit, you’ll likely get a higher interest rate, which will cost you more money over time. Lenders typically reserve lower interest rates for borrowers (or cosigners) with higher credit scores.
- Some limited funding: Depending on your income and credit history, the amount of money you can get for a medical loan may be limited. Some lenders offer up to $100,000, but others have much lower maximum loan amounts. This means you may not receive enough funds to cover the medical expense.
- May not qualify: Not all borrowers will be eligible for a medical loan. Being turned down for a medical loan can be discouraging if you depend on financing to cover a procedure. You may want to consider asking a friend or family member to cosign if you have bad credit.
- May save more with a provider payment plan: Many medical providers offer payment plans at low to no interest. Additionally, some medical providers offer discounts for cash payments. You may be able to save money by working directly with your provider.
Is a medical loan right for me?
A medical loan may not work for everyone. Medical loans are best for borrowers with good credit scores who can secure low interest rates, resulting in lower monthly payments. Al medical loan may also be beneficial if you need quick access to funds and flexibility with spending.
You may want to consider other options if you have an emergency fund that could cover the costs, if your medical provider is willing to offer affordable repayment plans, or your credit score only qualifies you for relatively high interest rates.
Alternatives to medical loans
There are also other options available to help you pay for medical expenses. Here are a few alternatives you might consider:
- Credit cards with 0% APR: If you’re considering a personal loan vs. credit card, keep in mind that some credit cards offer 0% APR for a short introductory period. If you’re able to pay off your credit card balance by the time this period ends, you could avoid paying interest. Just keep in mind that if you still have a balance after this time, you’ll likely be subject to some steep interest.
- Medical credit cards: These are credit cards specifically for medical expenses — some are available directly from lenders and others from healthcare providers. Many of these cards offer low to no interest on payment plans.
- Payment plans: If you’re unable to pay for a medical procedure up front, your healthcare provider might allow you to set up a payment plan.
- Borrow from family: If you’re looking to borrow a relatively small amount and can avoid borrowing from a financial institution, consider this option. Just beware of the potential strain that money can have on personal relationships.
- Ask for discounts: Speak to your healthcare provider about potential discounts. You may be able to get a discount for making a down payment.
- Negotiate a lower bill: Contact your provider to find out if you can lower your bill. You can also choose to hire a company to negotiate for you.
Keep Reading: Credit Card Consolidation Loans
Prequalified rates disclosure: Prequalified rates are based on the information you provide and a soft credit inquiry. Receiving prequalified rates does not guarantee that the Lender will extend you an offer of credit. You are not yet approved for a loan or a specific rate. All credit decisions, including loan approval, if any, are determined by Lenders, in their sole discretion. Rates and terms are subject to change without notice. Rates from Lenders may differ from prequalified rates due to factors which may include, but are not limited to: (i) changes in your personal credit circumstances; (ii) additional information in your hard credit pull and/or additional information you provide (or are unable to provide) to the Lender during the underwriting process; and/or (iii) changes in APRs (e.g., an increase in the rate index between the time of prequalification and the time of application or loan closing. (Or, if the loan option is a variable rate loan, then the interest rate index used to set the APR is subject to increases or decreases at any time). Lenders reserve the right to change or withdraw the prequalified rates at any time.
Requesting prequalified rates on Credible is free and doesn't affect your credit score. However, applying for or closing a loan will involve a hard credit pull that impacts your credit score and closing a loan will result in costs to you.